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4024/22 May/Jun 2025, Question 11: Simple Interest

Cambridge O Level Mathematics 4024 · Paper 22 (Calculator) · Calculator · 6 marks

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The question, in short

Compare two savings accounts: one with $4500 at 3.2% simple interest over 5 years, another with $2750 at 2.1% compound interest over 3 years; find final value and interest earned.

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Part (a) · 3 marks

Calculate the investment value after 5 years on $4500 at 3.2% simple interest per year.

  1. 1Interest = 4500 × 3.2/100 × 5 = $720
  2. 2Value = 4500 + 720 = $5220

Answer5220

Part (b) · 3 marks

Calculate the total interest received after 3 years on $2750 at 2.1% compound interest per year.

  1. 1Value = 2750 × (1 + 2.1/100)³
  2. 2= 2750 × 1.021³ = 2926.91…
  3. 3Interest = 2926.91… − 2750 = $176.91

Answer176.91

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